Daily market commentary

Nepse closes week with a modest loss

Published On: December 20, 2019 10:48 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Dec 20: Stocks witnessed a lackluster session on the last trading day of the week. The Nepal Stock Exchange (Nepse) index climbed slightly higher in the morning. Nonetheless, the gains evaporated quickly as the Nepse traded marginally lower throughout the afternoon. Nepse eventually ended the 2.42 points lower at 1,149.64 points on Thursday.

Some selling pressure was still visible in the bourse as an aftermath of a rally seen in the first half of December. Hence, the outlook points towards possibility of further correction in the coming sessions.

Market participation saw slight improvement on the day as total turnover stood at Rs 419 million.

Sector-wise performance was mixed on the day. Manufacturing & Processing sector led the gaining side as its component Shivam Cement Ltd posted big gains. The sub-index rose by 1.88%. 

Meanwhile, Trading sub-index also closed over 1% higher. Finance, Hotels, Mutual Fund and Hydropower sectors also closed the day in green. On the other hand, Non-Life Insurance segment saw further correction with its sub-index going down by 0.8%. ‘Others’ and Life Insurance segment closely followed with declines of around 0.7% each. Development Bank, Microfinance and Banking sub-indices ended the day with modest drops.

NMB Bank Ltd’s shares were traded the most ahead of its shareholder’s book closure for the annual general meeting (AGM) to be held on January 9. Over Rs 123 million worth of the bank’s shares were traded on the day. Next on the list was, Prime Commercial Bank Ltd with total turnover of Rs 30 million. Nepal Bank Ltd, Nepal Life Insurance Company Ltd and Shivam Cements Ltd were among other active stocks with turnovers of Rs 18 million, Rs 17 million and Rs 12 million, respectively.

Among gainers, Nepal Finance Ltd stretched its rally further with a 9.40% rally. Shivam Cements Ltd also saw considerable gain as its share price shot up by 6.76%. Similarly, Mahuli Samudayik Laghubitta Bittiya Sanstha Ltd and Bishal Bazar Company Ltd posted gains of over 5% each. Other top advances in the day were Rastriya Beema Company Ltd Promoter Share, Nepal Seva Laghubitta Bittiya Sanstha Ltd and Mahila Sahaytra Microfinance Bittiya Sanstha Ltd.

In contrast, Dibyashwori Hydropower Ltd witnessed significant selling pressure with its share price falling by 6.77%. Arun Kabeli Power Ltd saw its share price go down by 4%. National Microfinance Bittiya Sanstha Ltd, Taragaon Regency Hotel Ltd and Sindhu Bikash Bank Ltd were among other major decliners with losses of over 3% each.

On the news front, Nepal Bank Ltd has scheduled its AGM for January 10. Distribution of 15% bonus shares and 10% cash dividend are among the agendas of the AGM. This is the first time that the bank is distributing dividend since its inception.

On technical front, Nepse index formed a bearish candlestick stretching its retracement. Both Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) indicate sellers dominating the secondary market in the present context. However, the index still hovers around the support of 1,150 points. The benchmark index’s movement form this level will determine its further course.

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